HIRING PART-TIME WORKERS? ENSURE THEIR CPF CONTRIBUTIONS! FOR EMPLOYERS WITH 4-10 EMPLOYEES: e-SUBMIT TO SAVE ON PROCESSING FEE! SELF-EMPLOYED PERSONS - PAY YOUR MEDISAVE PROMPTLY ASK OUR CUSTOMER SERVICE OFFICER       Hiring Part-Time Workers? Ensure Their CPF Contributions!   Mdm Tan joined a downtown cafeteria in 2000 as a part-time waitress to supplement her family’s income. She worked during weekends and was paid around $650 per month. To get more take-home pay, she negotiated with the manager of the cafeteria not to pay her CPF as she is not their full-time staff. The manager agreed and made her sign a written agreement to forgo the CPF contributions. A familiar request? Do not enter into such private agreements with your employees to avoid CPF contributions. You will only be putting your company in a vulnerable position. Any part-time worker whose monthly wage is above $50 has to be paid CPF contribution like a regular employee. A number of companies learnt their lesson a painful way. Read on to this case: In 2006, Mdm Tan’s employment was terminated by the manager due to some disagreement. Subsequently, she lodged a complaint against the cafeteria owners for non-payment of CPF contributions for the six years she worked. Upon investigation, CPF Board informed the cafeteria owners that despite the written agreement, CPF contributions are payable for Mdm Tan. Without delay, the cafeteria owners paid all the CPF contributions for Mdm Tan and penalty interest to CPF Board to avoid prosecution. In addition, the cafeteria owners also paid CPF contributions and penalty interest for other part-time workers. The total payment was around $40,000. Private agreements not to pay CPF contribution is against CPF Regulations. Once discovered, actions will be taken against the employer to recover the amount due. The employees are not liable to pay the CPF contributions that were given to them as part of the agreement. Instead, both employer’s and employee’s share of CPF contributions, including the penalty interest to be paid to CPF Board, will be recovered solely from the employer. This means that the company will be paying much more than they were originally required to. Therefore, it is important that as employers, you should not risk entering into such illegal agreements with your employees. Be smart, learn the lesson from other companies’ experience!   For Employer With 4 to 10 Employees: e-Submit To Save On Processing Fee!   Since 2003, big and medium-sized companies have to pay a processing fee of $7 per employee per month if they choose to submit their CPF contribution details via the hardcopy Payment Advice. From October 2007, this processing fee will be extended to employers with four and more employees if they continue to use the hardcopy Payment Advice to submit their CPF contribution details. Employers who pay their CPF contributions via e-submission will not be charged the processing fee. Today, more than 33,000 employers have signed up and are enjoying the benefits and convenience of e-submission.

Choose an e-submission mode that is most suitable for you today!

Recommended Submission Mode	Do I need to pay?	What do I need to e-submit?	How do I make the payment*?
Online Form	No. It's free	Computer with Internet access	GIRO / Internet Banking
AXS Station	No. It's free	Nil	NETS / CashCard / GIRO
mPAL-Employer Submission	GPRS connection charges apply.  Please check with your mobile phone service provider for more details.	Compatible GPRS Java-enabled mobile phone.  Please check the CPF website for the list of best supported handsets.	GIRO

*For NETS and Internet Banking, you may wish to confirm the transaction limits with your bank.

Act early and sign up for e-submission! Please email us at Er-Con@cpf.gov.sg or call us at 6220 2340 if you have any queries on CPF e-Submission.

Self-employed persons who earn a yearly net trade income of more than $6,000 are required by law to contribute to their Medisave. Do you know that people who do not pay their Medisave liabilities may face court action?

If this happens, they will need to pay additional court fines. Not to mention, their image and business will be affected. Precious time will also be wasted.

You have no cause for worry if you make regular Medisave contributions! Do so by making lump sum payments or signing up to pay monthly instalments via GIRO.

Enjoy The Benefits Of Medisave!

Besides the high interest rate of 4% on your Medisave savings, you can also claim tax relief on your contributions as a self-employed person. In addition, you can use your Medisave savings to pay premiums for your MediShield or any other Medisave-approved private integrated plans offered by private insurers.

So why put your image and business at risk? Join the ranks of more than 200,000 self-employed persons and contribute to your Medisave today!

For more information on the various convenient payment modes, please refer to our CPF website www.cpf.gov.sg, or call the CPF Call Centre at 1800-227 1188.

Question:

It will be a new year soon. Like previous years, will there be any changes to the:

a) Salary ceiling
b) Additional wage ceiling
c) Voluntary contribution limit, and
d) Tax deduction limit for the self-employed persons?

Answer:

No. The amount of Ordinary Wages that attract CPF contributions each month remains at $4,500. Similarly, the Additional Wage ceiling will be the difference between $76,500 and the total Ordinary Wages subject to CPF contributions for 2007.

The maximum amount of contributions an employee or self-employed person may contribute voluntarily for 2007 is $25,245. You will not be able to make further voluntary contribution if your compulsory contributions⁺ have reached $25,245.

The tax relief that the self-employed persons currently enjoy remains at 33% of their net trade income assessed, or $25,245, whichever is lower.

⁺Compulsory contributions include CPF contributions on the Ordinary and Additional Wages if you are an employee, or Medisave contributions if you are a self-employed person.